What is covered under 'liability insurance' in motor policies?

The correct focus of liability insurance in motor policies is on legal costs and damages arising from claims made against the insured driver for injury or damage caused to third parties. This type of insurance provides financial protection in the event that the policyholder is found legally responsible for injuring someone or damaging another person's property while operating their vehicle.

Liability insurance is essential as it covers the legal expenses associated with defending against claims, as well as any settlements or judgments that may arise from such claims. This means that if the insured driver is involved in an accident and is sued for damages, the liability insurance will help to cover not just the payout for damages but also the associated legal fees, thereby safeguarding the policyholder’s financial standing in such situations.

The other options do not pertain to liability insurance specifically. Personal medical expenses relate to coverage for injuries sustained by the policyholder or passengers, property damage to the insured vehicle refers to damage coverage for the driver's own vehicle, and cost of vehicle repairs falls under comprehensive or collision coverage rather than liability insurance. This clarity on liability insurance helps to emphasize its critical role in providing protection against third-party claims.